Scenario 4-1 In a Given Year, Country a Exported $12 Million Worth

question 52

Multiple Choice

Scenario 4-1
In a given year, country A exported $12 million worth of goods to country B and $6 million worth of goods to country C; country B exported $4 million worth of goods to country A and $7 million worth of goods to country C; and country C exported $5 million worth of goods to country A and $2 million worth of goods to country B.
-When the government's spending is less than tax revenue, it implies that:

• A)the government budget is balanced.
• B)the government is running a deficit.
• C)there is a budget surplus.
• D)there is a higher chance of default by the government.
• E)the government needs to borrow from the central bank.

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Definitions:

Shelter Principle

In commercial law, a rule that allows a person who acquires goods in good faith to retain them, even if the sale was not authorized by the owner.

HDC Status

Holder in Due Course Status, which is a legal term that provides certain protections to the holder of a negotiable instrument from claims and defenses that could be raised by prior parties.

Marketability

The ability of a product or service to be sold or accepted in a market.

Free Transferability

The ability to freely transfer ownership of an asset or securities from one party to another without restrictions.